South Bow (NYSE:SOBO) vs. Paramount Resources (OTCMKTS:PRMRF) Financial Contrast

South Bow (NYSE:SOBO – Get Free Report) and Paramount Resources (OTCMKTS:PRMRF – Get Free Report) are both mid-cap energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, risk, earnings, institutional ownership, profitability, analyst recommendations and dividends.

Profitability

This table compares South Bow and Paramount Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
South Bow 22.99% 15.84% 3.73%
Paramount Resources 12.52% 4.31% 3.20%

Earnings and Valuation

This table compares South Bow and Paramount Resources”s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
South Bow $1.99 billion 3.52 $433.00 million $2.21 15.17
Paramount Resources $692.73 million 4.34 $922.32 million $0.57 36.15

Paramount Resources has lower revenue, but higher earnings than South Bow. South Bow is trading at a lower price-to-earnings ratio than Paramount Resources, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

4.1% of Paramount Resources shares are held by institutional investors. 36.3% of Paramount Resources shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for South Bow and Paramount Resources, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
South Bow 3 8 4 0 2.07
Paramount Resources 0 3 4 1 2.75

South Bow presently has a consensus price target of $33.00, indicating a potential downside of 1.55%. Given South Bow’s higher possible upside, research analysts clearly believe South Bow is more favorable than Paramount Resources.

Dividends

South Bow pays an annual dividend of $2.00 per share and has a dividend yield of 6.0%. Paramount Resources pays an annual dividend of $0.43 per share and has a dividend yield of 2.1%. South Bow pays out 90.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Paramount Resources pays out 75.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility & Risk

South Bow has a beta of 0.23, indicating that its share price is 77% less volatile than the S&P 500. Comparatively, Paramount Resources has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Summary

Paramount Resources beats South Bow on 9 of the 16 factors compared between the two stocks.

About South Bow

(Get Free Report)

South Bow Corp is a strategic liquids pipeline company. It is a new liquids-focused midstream infrastructure company. South Bow Corp is based in Canada.

About Paramount Resources

(Get Free Report)

Paramount Resources Ltd. explores for and develops conventional and unconventional petroleum and natural gas reserves and resources in Canada. The company holds interests in the Karr and Wapiti Montney properties covering an area of 109,000 net acres located south of the city of Grande Prairie, Alberta; Kaybob North Duvernay development and natural gas producing properties covering an area of 124,000 net acres located in west-central Alberta; and Willesden Green Duvernay development in central Alberta and shale gas producing properties in the Horn River Basin in northeast British Columbia covering an area of 249,000 net acres. The company was founded in 1976 and is based in Calgary, Canada.

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